Income from Dumping Law Puts Stanley Furniture in Black in Second Quarter
STANLEYTOWN, Va.-A total of $39.4 million in proceeds from the Continued Dumping and Subsidy Offset Act (CDSOA) turned Stanley Furniture's second-quarter bottom line from red to black.
Net income in the quarter, which ended on June 30, was $36.9 million. Enacted in 2000, CDSOA provided for the distribution of funds from duties on imports that were determined to be subsidized or unfairly priced to U.S. companies that filed complaints against these imports. Without that disposition, Stanley would have posted a net loss of $2.5 million in the second quarter, compared to a net loss in last year's second quarter of $595,000.
According to the website ebearing.com (which tracks the bearing industry), CDSOA was repealed by the U.S. Congress in 2006. However, the site said, the "underlying mechanisms of trade duty and collection finances" will take many years to resolve, meaning that some U.S. manufacturers will receive income from this law for years to come.
Stanley's second-quarter net sales fell 10.8 percent to $24.4 million. Gross margin fell 66 basis points to 12.6 percent. Selling, general and administrative expenses--although they were down 5.6 percent on a dollar basis--rose 103 basis points as a percentage of sales to 18.4 percent.